Are ethnic employment penalties mitigated in deprived neighbourhoods and in ethnically dense neighbourhoods?

Abstract

AbstractExisting research has extensively documented that those living in the most deprived neighbourhoods and individuals from some ethnic minority groups have low rates of labour market participation in the United Kingdom. This paper brings together these two established areas of research to ask whether ethnic minority groups have better employment participation when living in more deprived neighbourhoods. We hypothesise that this could be due to different socialisation processes enabling ethnic minorities to secure employment more easily in deprived neighbourhoods as well as in neighbourhoods where there is greater ethnic density. Data from the United Kingdom Household Longitudinal Study in England are linked to the Index of Multiple Deprivation 2014 and the 2011 Census to model unemployment and economic inactivity between 2009 and 2019 separately for women and men. The results show that some ethnic minority groups face disadvantage in the labour market, especially Pakistani and Bangladeshi women. There is little support to suggest that these penalties are lessened in more deprived neighbourhoods or in more ethnically dense neighbourhoods. There is some suggestion that groups who do not face ethnic penalties compared with the White British group have lower rates of unemployment and economic inactivity in more deprived neighbourhoods. We suggest policies aimed at improving labour market outcomes for disadvantaged ethnic minorities should target them wherever they live.